The lawyer taking on Uber and the rest of the on-demand economy • Hacker News Board

Re: The lawyer taking on Uber and the rest of the on-demand economy

#41

Post by [deleted] » Fri, Apr 17, 2015, 4:28 PM UTC

wpietri wrote: post #17

jkoudys wrote: post #10

This right here is one of the driving forces behind American corporatism. While these cases are always launched claiming to be on the side of the angels, they ultimately ignore that all that extra legal overhead is not free, and only the currently large companies will be able to manage it, essentially barring any smaller competitors from entering the market. If a court rules that Uber drivers must be employees, then…

I agree US businesses would be better off if we make our health care system work like any other civilized country. Tying health care to employers has turned out to be a terrible mess. But I think you're wrong about the general dynamic of class action suits. There are two basic approaches to running a functioning society. You can establish a fair bit of regulation on how each thing is supposed to work and enforce it v…

[deleted]

Re: The lawyer taking on Uber and the rest of the on-demand economy

#42

Post by eykanal » Fri, Apr 17, 2015, 4:34 PM UTC

> Fiona Ramsey, the director of communications for Peers... added: “We worry the share economy will cease to exist if these cases are successful.”

> That worry may be exaggerated, however. Deep-pocketed companies like Uber, which has raised nearly $5 billion in venture capital since launching, could surely afford the additional expense of putting drivers on its payroll.

What a silly argument! Raising a ton of money in venture capital doesn't mean that the business model itself is profitable, and in the long run that's what matters. If the profitability of the entire business model is built on illegal classification of workers, then the model is a failure (within this legal framework, at least) and won't work.

Either change the law or change the model, but something will have to change.

Re: The lawyer taking on Uber and the rest of the on-demand economy

#43

Post by erroneousfunk » Fri, Apr 17, 2015, 4:55 PM UTC

greggyb wrote: post #22

An analog that sprang to my mind early in the article, and briefly raised with the comparison to Craigslist, but which I feel is more apt than Craigslist: eBay. Some points: * eBay can ban a seller for not following the rules. * eBay absolutely requires its sellers to earn revenue. * eBay can set expectations and incentivize behavior with its various seller-partner programs at different levels. * An eBay seller may d…

When customers use Uber, they have no real choice in the drivers they are getting, unlike eBay or Craigslist, where they can comparison shop and choose based on seller ratings, product/seller descriptions, and prices. With Uber, you just press a button and Uber gives you a driver that is assigned to you, at a rate that Uber defines. The consumer is penalized for canceling the trip (you can usually get the cancellation fee waived if you have a good reason, i.e. "the driver didn't arrive for 20 minutes and seemed confused when I called them")

Rather than merely being a medium for connecting drivers and passengers, Uber the controller of these transactions, and is assuming the role as the provider of the services.

There are many other reasons that the eBay/Uber comparison is invalid, which other commenters have given. And, like the original author said, Uber drivers fail the IRS's 20 point test spectacularly.

Re: The lawyer taking on Uber and the rest of the on-demand economy

#44

Post by lhc- » Fri, Apr 17, 2015, 4:56 PM UTC

Nursie wrote: post #19

wpietri wrote: post #16

Earlier quoted context omitted.

> I assume Uber's business model doesn't rely on contractors tax-dodging or skimping on vehicle maintenance! I'm not sure that's a good assumption. Nobody is valuing taxi companies at $40b. Part of why they're so appealing from an investment perspective is that Uber's model is a heads-I-win-tails-you-lose proposition. Any time money gets made, Uber gets a big cut. Costs and most downside risks are transferred to the…

>> pretending that employees are contractors is a pretty popular way of screwing workers. I have a feeling that sooner or later, possibly in a country like France, they're gonna get called on this and dragged through the courts for big bucks.

This article is about current lawsuits, in the US, for exactly this reason.

Re: The lawyer taking on Uber and the rest of the on-demand economy

#45

Post by oh_sigh » Fri, Apr 17, 2015, 4:57 PM UTC

The opening lines are crazy. The moment she heard about the app, before she knew anything about it, she had the idea "to put them out of business"? That doesn't seem like the behavior of an altruistic person. Shouldn't she have, you know, researched the structure of uber before deciding that she wants to destroy them? How would she know that the employment status of the drivers from her friend saying "You have to see this"?

Re: The lawyer taking on Uber and the rest of the on-demand economy

#46

Post by fragmede » Fri, Apr 17, 2015, 5:00 PM UTC

gaius wrote: post #18

wpietri wrote: post #16

Earlier quoted context omitted.

> I assume Uber's business model doesn't rely on contractors tax-dodging or skimping on vehicle maintenance! I'm not sure that's a good assumption. Nobody is valuing taxi companies at $40b. Part of why they're so appealing from an investment perspective is that Uber's model is a heads-I-win-tails-you-lose proposition. Any time money gets made, Uber gets a big cut. Costs and most downside risks are transferred to the…

Nobody is valuing taxi companies at $40b A legal Uber already exists (in London): it's called Addison Lee. Smartphone app and everything. It's worth £300M, not $40Bn! http://www.bbc.co.uk/news/uk-england-london-22230868

Part of that valuation has to do with size and breadth.

Uber is currently available in 56 countries, how many is Addison Lee available in?

If there was no such thing as Uber, and no one else was allowed to write a taxi app other than Addison Lee, it would easily be worth $40 billion.

Re: The lawyer taking on Uber and the rest of the on-demand economy

#47

Post by sjg007 » Fri, Apr 17, 2015, 5:06 PM UTC

jkoudys wrote: post #10

This right here is one of the driving forces behind American corporatism. While these cases are always launched claiming to be on the side of the angels, they ultimately ignore that all that extra legal overhead is not free, and only the currently large companies will be able to manage it, essentially barring any smaller competitors from entering the market. If a court rules that Uber drivers must be employees, then…

It's always been that way if you want good healthcare (or have a union). Hopefully this will push things towards single payer. I'd rather pay out my taxes than pay out of my pre tax income.

Re: The lawyer taking on Uber and the rest of the on-demand economy

#48

Post by SomeStupidPoint » Fri, Apr 17, 2015, 5:07 PM UTC

greggyb wrote: post #30

Bahamut wrote: post #27

Earlier quoted context omitted.

The article points out some aspects that make this a not so great analogy - in particular, companies like Uber set the rates, and put the burden of costs on the workers for stuff like gas, wear and tear, etc. Uber in particular is taking half of the tips according to the article, which sounds unethical. My only opinion on this is that the balance should probably be tilted a little more in the workers' favor for these…

>The article points out some aspects that make this a not so great analogy - in particular, companies like Uber set the rates, and put the burden of costs on the workers for stuff like gas, wear and tear, etc. Uber in particular is taking half of the tips according to the article, which sounds unethical. These are very good points and I am glad you brought them up. I think the rates and tips are very valid concerns h…

I think the real point of challenging Uber is this: they can either set the rates or they can push the cost of materials on to drivers, but they can't do both.

That is, they must either embrace the full employee or full contractor package, and not just take the parts they like of each with none of the liabilities.

Re: The lawyer taking on Uber and the rest of the on-demand economy

#49

Post by AJ007 » Fri, Apr 17, 2015, 5:08 PM UTC

nulltype wrote: post #40

wpietri wrote: post #17

Earlier quoted context omitted.

I agree US businesses would be better off if we make our health care system work like any other civilized country. Tying health care to employers has turned out to be a terrible mess. But I think you're wrong about the general dynamic of class action suits. There are two basic approaches to running a functioning society. You can establish a fair bit of regulation on how each thing is supposed to work and enforce it v…

Is there a way to remove the distinction between employee and contractor? It feels artificial to me, like everyone should be one or the other. Removing the link between health care and employment seems like a good start. Does the distinction serve a useful purpose? It seems like they are both "people you hire to do work".

Books could be written to answer this.

A contractor could be viewed as a business relationship -- here is the contract, do what it says or don't get paid/the money back from you. Certainly there is value for having work done on a contract. The contractor should be able to do it themselves or subcontract it out.

An employee could be seen as a single individual who shows up on time and is paid for doing so. It is the employer's job to make sure the individual is doing something productive whatever those tasks may be.

That is a very simple separation and not really correct, but certainly there are good reasons for there to be legal separations. Also consider there are so many legal expectations for the two depending on where one is located. A big challenge for startups riding the line.

Personally I am more concerned about basic labor rights & employer abuse rather than guarantees of benefits and minimum wages. One only has to look at migrant labor abroad to get a good idea of just how bad it gets -- slavery alive and well.

Re: The lawyer taking on Uber and the rest of the on-demand economy

#50

Post by oh_sigh » Fri, Apr 17, 2015, 5:17 PM UTC

gaius wrote: post #18

wpietri wrote: post #16

Earlier quoted context omitted.

> I assume Uber's business model doesn't rely on contractors tax-dodging or skimping on vehicle maintenance! I'm not sure that's a good assumption. Nobody is valuing taxi companies at $40b. Part of why they're so appealing from an investment perspective is that Uber's model is a heads-I-win-tails-you-lose proposition. Any time money gets made, Uber gets a big cut. Costs and most downside risks are transferred to the…

Nobody is valuing taxi companies at $40b A legal Uber already exists (in London): it's called Addison Lee. Smartphone app and everything. It's worth £300M, not $40Bn! http://www.bbc.co.uk/news/uk-england-london-22230868

Addison lee had 4500 drivers at their time of sale. I don't think the number of uber drivers is disclosed, but it is at least 162,000 active drivers as of this past December: http://www.washingtonpost.com/blogs/wonkblog/wp/2015/01/22/n...